July 19. It’s a Cadillac

–I almost missed a window of opportunity regarding the situation in Turkey.  On a slow day some time ago, (like yesterday), a euro$ options pit broker who shall go unnamed, is standing around in the crowded pit doing the crossword puzzle.  Clue:  COUP D’_ _ _ _   Subject’s answer: VILL.  See?  The floor is better than the screen.

–With all the fanfare about stocks recovering and pressing new highs, having shaken off Brexit in a few days and the Turkish coup in a few minutes, it’s interesting to note that Calpers annual results ending June 30 showed a gain of just 0.6%.

“It was the second straight year Calpers failed to hit its internal investment target of 7.5%. Workers or local governments often must contribute more when pension funds fail to generate expected returns.”  Perhaps Calpers was heavily invested in Hamptons real estate. (Reuters) “Total sales volume in East Hampton fell 53 percent from a year ago to $44.7 million as the median sale price fell 54 percent to $2.38 million.”  In more middle of the road anecdotal data, Volvo scaled back its sales projections for heavy trucks in the US as demand slows more than forecast.

–Rates were little changed yesterday, having eased by 0-2 bps across the curve; bond was unchanged.   Large trades were a new buyer of EDZ6 9912/9925/9937 c fly 1x3x2 which settled 1.25.  Also a buyer of EDZ6 9925c vs sale of same strike in 0EZ for a credit of 0.5 (sold 0EZ over).  EDZ6/EDZ7 futures spread settled 18.0 (9917.5 and 9899.5).   The former trade targets a settle of 9925, the latter does best with a settle above 9925 with the calendar spread maintaining relatively wide levels.  Housing Starts today.

Posted on July 19, 2016 at 5:34 am by alexmanzara · Permalink
In: Eurodollar Options

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